When nonreceipt is transmitted as a B-stop, “payment before status,” The Department
of the Treasury (Treasury) issues a courtesy disbursement check to replace the missing
original check. A courtesy disbursement check is issued before the status of the original
check is known and bears a different check number from the original check. The bottom
of the check will also have a statement “Replaces check #12345678 dated MM/DD/YY.”
An A-stop for mass loss works the same way as a B-stop – payment before status, because
SSA’s system changes it to a B before sending it to Treasury. Therefore, if the original
check is cashed after a courtesy disbursement check is issued and cashed, a DCN will
occur and Treasury will send out claims packages for both checks. DCNs in mass loss
situations should be processed as any other DCN situation. See instructions below.
If a C-stop (“payment after status”) is input and the original check has not been
cashed, DT will issue a replacement check.
Although the beneficiary/recipient is advised not to cash both the original and courtesy
disbursement, or replacement check, the original may be subsequently cashed and is
a potential overpayment situation. This section explains what occurs when Treasury
determines that the original and a courtesy disbursement or replacement check are
cashed for the same benefit month.
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Debit and credit information is posted to the PHUS, SSR, and the Treasury status query
control record when the original check is cashed, and reflects each credit given or
overpayment being charged to SSA. See SM 00545.295H.4. for debit and credit codes
for Title II and SM 01315.200 for Title XVI.
A credit will usually be posted to PHUS, SSR, and ARS when Treasury has refunded money
in stop payment cases.
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SSA treats the courtesy disbursement or replacement check as an overpayment and initiates
recovery action, and
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SSA sends the claimant a notice of overpayment that explains the 60-day appeal period
and the right to request reconsideration by SSA, waiver, personal conference, or a
different rate of adjustment. It also explains that overpayment recovery will begin
in 90 days unless a request for reconsideration is received.
IMPORTANT: Double check negotiations should NOT be waived as they indicate an intention to
commit fraud by falsely stating that the check was not received. Similarly, the $1,000.00
waiver tolerance does not apply because the beneficiary or claimant is not “without
fault.”